Hitachi Vantara has signed a 220,156-square-foot lease at Santa Clara Square, a deal that will take the tech conglomerate from its headquarters of more than 25 years a mere two miles down the road in search of new amenities.

Exclusive: Hitachi signs big lease in Santa Clara development

January 08, 2018

Hitachi Vantara has signed a 220,156-square-foot lease at Santa Clara Square, a deal that will take the tech conglomerate from its headquarters of more than 25 years a mere two miles down the road in search of new amenities.

“Santa Clara Square is a leading-edge facility and I think it really reflects where our company is going,” Lori Varlas, chief financial officer at Hitachi, said in an interview with the Business Journal on Monday. “It’s is not only great for our employees in attracting talent and driving efficiency, but also a wonderful location to host our customers.”

Hitachi is slated to move into all of the office space in the brand-new, six-story building at 2535 Augustine Dr. near Santa Clara Square’s Marketplace, a budding retail hub anchored by Whole Foods. The group will relocate in spring 2019, when Hitachi’s lease ends at its current headquarters, which is split between two buildings at 2845 Lafayette St. in Santa Clara.

CBRE represented the landlord, Irvine Co., in the deal, while JLL's Ryan Atkinson and Andy Poppink represented Hitachi Vantara in securing the lease.

The move comes as more companies seek out amenity-rich locations to lease, often leaving behind or expanding outside of the suburban-style offices that Silicon Valley is known for.

That trend has boosted places like downtown San Jose as a tech hub in the past year, attracting startups, law firms and giants like Google. The shift has also drawn in recent months players like Veritas and Amazon to Santa Clara Square, a massive mixed-use project developed by Newport Beach-based Irvine Co.

“It’s exciting to see how leading Silicon Valley companies are embracing our vision to bring best-in-class office, retail and rental-living together to simplify and enhance the lives of their employees," Todd Hedrick, Irvine’s regional vice president, said in a statement Monday.

While Hitachi may be upgrading in terms of amenities, it is downsizing a bit, in terms of office space. It is currently leasing 305,000 square feet, and will shed nearly 85,000 square feet when the company relocates to Santa Clara Square.

Notably, some of that 85,000 square feet is taken up by a café and gym at its current headquarters, which will now be shared amenities with other office tenants at Santa Clara Square.

The move comes after Hitachi has gone through some serious reorganizing over the past year.

Though the Japanese company’s Santa Clara arm — once known as Hitachi Data Systems — has historically served as its data-storage hub, the local office has expanded its portfolio to include cloud technology, data analytics, infrastructure and Internet of Things products.

In April, the company cut 118 jobs locally, followed by another 48 layoffs reported by the Business Journal in June. In September, the company announced it had launched Hitachi Vantara, a new business entity aimed at unifying Hitachi Data Systems, Hitachi Insight Group and Pentaho “into a single integrated business."

The layoffs were part of what the company calls part of a huge transformation to be more “globally competitive,” by shifting its workforce to focus to initiatives like its smart city and Internet of Things businesses, a spokesperson told the Business Journal in June.

The company’s pending move is just another step in its larger effort to rebrand itself as Hitachi Vantara, Mary Ann Gallo, chief communications officer for Hitachi, said in an interview on Monday.

Parent company Hitachi Group has more than 303,000 employees worldwide. Between 700 and 1,000 employees, contractors and consultants will move to the new office in Santa Clara Square, a company spokesperson said Monday.

Taking a conservative estimate of one employee per 200 square feet, the company’s new office would have room for about 1,100 employees, though many Silicon Valley giants are squeezing more employees into fewer square feet using an “open office” approach.

In June, the company reported it had about 700 employees in Santa Clara, but Gallo said the company has grown since then, including by adding a handful of big-name hires in recent months. And the company plans to continue to grow, she added, noting that the growth will likely be helped along by the company’s new digs and surrounding amenities.

“We are building this great company with a tremendous future,” Gallo said. “And having a great place for employees and new hires to come and work and collaborate together, I think this is a great proof-point to our investment in that.”

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